NanoDynamics IPO priced at $11

The Dubai International Financial Exchange is all set to receive the listing of its first US-based company shares next week.

The initial public offering (IPO) of NanoDynamics, a global alternative energy and clean technology firm, has been priced at $11 (Dh40) per share, its lead managers announced yesterday.

“The issue is for 9.1 million shares, which will give the new owners approximately one-third of the company,” said Shehab Gargash, Chief Executive of UAE investment firm Daman.

“The listing is likely during the second week of February. We are right now in the process of placing it, with the actual date to be announced shortly. The pricing has been set at about between $10 and $12.50,” Gargash said.

About half of the participants in the listing will be US-based institutions, while the other half will be regional institutions and investors.

“This is historic because it’s the first time major US institutions will be participating on a DIFX listing. It has actually been received very positively in the US,” said Rani Jarkas, CEO of Daman’s US strategic partner Global Crown Capital.

The nanotechnology firm’s global presence – it has clients in Europe, China, India, Russia and Japan – makes listing on the Dubai bourse an important move, according to Jarkas.

“The listing could have been on Nasdaq, it could have gone anywhere [but] we believe DIFX’s technology platform will be a major financial hub in the region,” Jarkas told reporters.

“There will be more firm to be listed on the DIFX in that field, it’s a very attractive sector right now, and a lot of institutions are keen on investing in nanotechnology, alternative energy and clean technologies,” he said.

He said underwriters have emerged unscathed from one of the worst months in world stock markets in history in January, with the IPO sector expected to be on track.

“Typically IPOs don’t happen during these times, but that shows you the quality of the underwriters, institutional investors and of the company, because the offer is still on and we are listing next week,” he said.

Gargash said Daman is confident the liquidity of shares post-IPO will be at a significant level because of the type of investors coming on board, coupled with market activity. “This is one of a series of IPOs that we are working to bring onto the DIFX from the US markets,” he said.

NanoDynamics has a market cap of around $475 million. According to Global Crown Capital research, the firm will see $40m in revenues in 2008, discounted by 35 per cent. The revenues are expected to reach $80m in 2009 and $180m in 2010.

“The revenue doubles every year, so the growth is very significant. The company will become profitable as of first quarter of next year,” Jarkas said.